Cross Platform Gaming and Microsoft’s Checkmate

Microsoft's recent announcement takes us one step closer to platform neutral gaming. It was recently revealed that changes to Xbox Live would go beyond the anticipated PC/Xbox compatability, and (in theory) begin to allow cross platform network play on selected titles (with Rocket League being the first).

From a business perspective this is a ballsy move by Microsoft and fundamentally changes one of the key driving forces behind console sales. While consumers have anguished at the age-old problems of console specific platforms, where you can’t play games with friends unless they have the same system as you, manufacturers have benefitted from the creation of “tribes” i.e. where groups of friends will all agree to get the same console, creating significant social pressure to conform and driving sales.

Consequently, by making the first move towards console inclusive online play Microsoft has pulled off a Game of Thrones level checkmate – they have everything to gain and Sony has everything to lose.

Currently Sony is crushing Microsoft in terms of console sales in this generation, with over 35 million PS4s sold. By comparison things have gotten so embarrassing for Microsoft that they have stopped giving out clear numbers of Xbox One sales, though analysts’ estimates put them at a little more than half of that at best.

Given Sony’s commanding lead they greatly benefits from console tribalism as it creates a snowball effect driving further sales and increasing their market share – i.e. with so many more PS4s out there, any new consumers will be greatly motivated to buy a Ps4 because their friends have one.

Microsoft’s weak position creates a strong incentive for them to cross platform gaming - if Sony agrees to this, Microsoft has the perfect opportunity to bring down the structure which Sony is leveraging to grow its relative market share and poach potential customers.

The genius behind this announcement is that it puts Sony in a difficult position. Sony has the unenviable position of agreeing to a partnership, which will almost definitely cost them market share/future growth, or declining the offer and having Microsoft announce to the gaming community that Sony is standing in the way of progress.

It is a wining move for Microsoft and a losing position for Sony no matter how it eventually plays out.